It is often said that you can reduce your investment risk by creating a portfolio of stocks rather than investing in a single stock. This concept is referred to as diversification. Diversification significantly reduces some component of the total risk (also referred to as diversifiable risk). What is the name of the basic risk concept that we can reduce through diversification? a) Systematic (market) risk b) Non-systematic (unique) risk c) Interest rate risk d) Labor risk e) Foreign exchange risk Oscorp has a stock beta of 2.75 and Spidey Inc. has a stock beta of 3.1. If you put 35% of your money in Oscorp and 65% in Spidey, what will be the beta of your portfolio? a) 2.76 b) 1.95 c) 2.97 d) 2.13 e) 3.25 Clampett oil is considering a new project. They believe that the project has a beta of 3.31. The T-bill rate is 2.5% and the S&P 500 return (which represents "market") is 12.5%. What is the appropriate return on the new project? a) 34.30% b) 35.60% c) 26.45% d) 29.75% e) 33.50%